Replies to post #136877 on Biotech Values

[iwfal]

MNTA -

Per the latest Credit Suisse write up, they estimate Watson's retail sales of Enox adding about a dime per year in earnings. Now using a little commonsense, would you believe WPI would risk their whole enterprise to earn a silly 5 cents (prior to trial).

They know something we don't.

And MNTA/NVS, 'knowing' that WPI is immune and A* has no assets, didn't settle immediately upon the stay - must indicate they know something you don't. (The point is it works both ways - somebody is wrong and our job is to assess who, not slavishly assume one or the other is completely right.)

FYI My personal opinion is that the indemnification is partial - i.e. that WPI will get hit with somewhere between 40 and 70 percent of the total damages plus extra damages. Combine this with a little bit of irrationality on the part of WPI and you get a dumb launch. (I tend to trust Momenta management as more rational than >90% of biotechs.)

PS I also think there is some chance that the scenario (voiced earlier on this board) of WPI choosing not to sell to their assigned customers turns out to be true so only A* is selling. It would be the smart play for WPI.

[exwannabe]

Now using a little commonsense, would you believe WPI would risk their whole enterprise to earn a silly 5 cents (prior to trial).

Yet, just 3-4 years ago many of our major financial institutions were doing exactly that. The 'C' level knew quite well they were diving down a hole, but did so anyway.

Why?

Because it made bonus money for management.

For 2 years WPI management will profit off this. If MNTA wins the suit, WPI shareholders pay.

Management != Ownership

[zipjet]

Per the latest Credit Suisse write up, they estimate Watson's retail sales of Enox adding about a dime per year in earnings. Now using a little commonsense, would you believe WPI would risk their whole enterprise to earn a silly 5 cents (prior to trial).

That is perfectly logical. I would certainly hope so. I do not like "bet the company" decisions. And WPI looks to be making one.

They know something we don't.

I'm sure they do. But it did not stop the trial judge from issuing the injunction. After that, how can they be sure? How can they rely on that "something" which they know?

But in my world view, the outcome of litigation which regularly depends on the interplay of multiple decision makers (judge, jury, CoA panel, CoA enbanc, etc.) makes predicting the outcome difficult.

We don't have to look any further than the CoA staying the injunction - and unless I have missed something - without so much as a hint of the basis.

BTW - I am not wildly optimistic. I will take money from on-going revenue any day over the prospect of a distant court win. And for now we are back to betting on court outcomes.

ij